The Man Who Retired the Museum’s Debt

Exterior wall of the Milwaukee Public Museum. Photo by Brian Jacobson.

In other museums in other cities, doesn’t the bigger piece of the pie come from private donations or endowments?

You have to step back for a minute. Milwaukee County, through state statute, is authorized to run a public natural history museum. We have a contract to run that museum for Milwaukee County. We feel we run it in a very efficient manner. The money we receive from the county is less than we received in 1992 when the museum was first contracted. And I would say there aren’t many vendors who have gotten the same price for over 20 years, so I think it’s a pretty good deal.

Now, fundraising is in a bunch of different buckets. Each year, we have to raise about $4 million in fundraising. That fundraising combined with our attendance and our contract with the county allows us to operate. The other thing that institutions like us do is we run a capital campaign. That would be for specific purposes, for example, this past year the capital campaign helped pay off the debt. We’re always out there looking for that capital money which is not part of the yearly operating cost.

Then on top of that, you’re always trying to build the endowment. That comes in, by and large, through planned giving. That’s when people put the museum or their favorite institution into their estate plan. So you’re raising money every year just to keep the thing going, and then running a capital campaign. We have two new exhibits we’re in the process of building and trying to raise money for them—that’s in the capital campaign.

The capital campaign is one of the biggest things you have continually emphasized. How is that coming along?

We had a good year or two with the capital campaign and the museum will have to continue to execute that for the next five years and hopefully after that we will have reached some of the goals. It is hard to reach that $4 million point every year—it’s really difficult.

If I was to go around the country and benchmark museums, just looking at averages—there are a couple things we don’t have. One is the endowment. In 1992 when this place started (as a privately-run institution) there was no endowment. Right now our endowment is about seven million, while the best institutions have an endowment that’s about four times their operating expenses. Our (annual) operating expense is about $12 million. So you’d like to have an endowment that is about $48 to $50 million.

The other thing museums have which we do not is parking revenue. If you go around the country, one of the top revenue sources is parking. So this building is owned by the county, while we’re attached to a parking garage owned by the city. Every year, we have around 600-700,000 guests come in here. If they are parking in that garage, we aren’t getting any of the revenue. The Milwaukee Art Museum and Discovery World each have their own parking structure. At some point down the road, we have to determine do we try and raise money for a parking structure or not.

How did the Pirates exhibit do?

We hit around 96% of our projected attendance. We made a little less money than we thought, but the good news is that we had more children come.

Kids were more interested in pirates than mummies?

Yeah, kids loved the pirates and we had a wonderful time with a bunch of actors and interpreters in the exhibit. It made the exhibit so fascinating and these people would stay perfectly in character all day.

Does that inspire the programming teams to say, “if that worked here, would that work in other sections having live interpreters”—I know that occasionally you have them roaming the Streets of Old Milwaukee and it’s very popular.

I think you’ll see us doing more with interpreters. It’s interesting because it’s even better than technology because that person can relate directly to the visitor whether they are six-years or 86 years-old.

Because when you press a button on a screen it will tell you a specific answer to a specific question, but not the way a child might ask?

You don’t get the interaction in the same way. None of this stuff is a silver bullet—we’re going to be adding more technology as well to create interest and provide more information. But we’re also going to have more people here who can help you experience the rainforest or the third planet and tell you what is going on.

When you first came in, you made sure a lot of details were changed. The logo, for example. Things like the green roof or the solar panel wall.  Are they just attractions, or do they actually contribute to the sustainable part?

They’re kind of intertwined. What we have to do is create an experience here so people want to come back and come back and come back. It means you have to have great people on staff that greet people and are professional and courteous.  You’ve got to always have people know the museum is working on something—I think some people think things here never change but really they are changing all the time. Along with the solar panels, green roof, China exhibit we have Native American games exhibit. That’s not counting the traveling exhibits that come through.

You want to create an experience.  That means the bathrooms are clean, all the exhibits are working all the time, the lights all work, all the little bits you would expect if you were attending a top-flight cultural attraction. It’s what people experience when they go to Disneyland. That’s what we want to have here but then flip into an educational model. We want people to cultivate curiosity and ask “why”? I love the new theater (a partnership with National Geographic) in there now, you can come and see sea monsters in 3-D. We’re getting current, new content which is really good.

If part of the new model is less risky, showy traveling exhibits and more towards working on the infrastructure, will we see any of the collections that are stored at the museum in special shows? I know some people are keen on the bicycle collection.

Yeah, we’d like to do more stuff there and that’s a resources issue—it’s a limitation financially. It’s not as simple in the museum world to put collections out on exhibit as one would think. You have to remember when they go out on exhibit, often times they can deteriorate, once you expose them to light and air. One of the reasons to have a collection is for research and we’re selective of what we put out because we recognize it could be damaged.

But we’d like to promote more of what we have here. A lot of that may mean working on our current exhibits that are already out—refreshing some of the objects that are out there.

But you see, in this model, you cannot have debt. It’s fundamental. When I got here, there was almost $17 million in debt and seven years ago there was some $25 million. You don’t generate enough cash to pay back debt. It puts you at risk.  We are so fortunate going forward that we won’t have it—or I should say—for the debt we have there are pledges coming in to pay it off.

We are still going to have major traveling exhibits coming to the museum. I don’t want people to think we’re not. We’ll have Body Worlds here this Spring. We’re going to have a cool exhibit, “The Scoop on Poop,” this fall. But we would like to promote more of the stuff we have going on here and integrate that with traveling exhibits both huge and small.

For years, if you go back to the last time Body Worlds was here in 2008, traveling exhibits generated huge cash flow. But after the recession, traveling exhibits started falling. You don’t make money but you don’t lose money—it’s kind of break even. What that means is, you’re not going to make enough money to subsidize a loss on your core business. Now you’re core business has to break even.

Booking exhibits is like booking any other traveling Broadway show or rock band to your venue. Every exhibitor has a different contract and you’re trying to negotiate something you both think is mutually beneficial. Obviously we didn’t do that with Cleopatra. Like I said in last year’s video (of the Annual Report), we lost our shirts on the Cleopatra exhibit.

As president, you must have been shown all the secrets of the museum. You must have received a dossier stating where all the types of rattlesnake buttons were located, or the ball in the demon’s mouth in the China exhibit…

I already knew that, we would come here in when our kid was little, so… I can’t think of any more at the moment.

There’s the howler monkey.

Yes, the howler monkey. My granddaughter loves that one and takes her friends up there and gets them into position so she can press the button and surprise them.

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